Joint Venture financing for construction projects in Kenya

Joint Venture financing in construction projects is whereby the land owner only contributes the land, with no other financial contributions, and the financier comes up with funds, to enable the two to realize a construction project.

The process is relatively simple, the land owner comes up with an unencumbered land, of which a4architect.com can then undertake feasibility studies to determine the maximum potential for the development. With this feasibility report and architectural drawings, a meeting is then arranged with potential financiers for the negotiations to begin.

After agreements, the construction commences and finally, after completion, the financier sells off their share and the land owner then can rent out their share while the cost of construction is offset by selling off the shares that are equal to the cost of construction.

The land owner gets a share that is equal to at least 50% of the profits plus cost of the land.

Notable Joint venture projects around Nairobi are Runda Park along Kiambu road, Sunrise estate at Athi river and Parklands Luxury Gardens in Ngara.

Size of the land is crucial in that larger lands are more suitable and attractive to financiers since its easier to benefit from economies of scale. Lands in prime locations, near tarmac, in major towns are also very suitable for this. At www.a4architect.com, we can conduct quick feasibility to determine of your land fits within this scenario.